Bakkafrost earnings hit by increased production costs

The Bakkafrost Group delivered a total operating EBIT of DKK 268.2 million in Q1 2018. Harvested volumes were 12.200 tonnes gutted weight.

Commenting on the result, Bakkafrost CEO Regin Jacobsen said: “In the previous quarter, Bakkafrost had very good performance in all three segments. In comparison, Bakkafrost harvested fish from farming sites with weaker performance in the first quarter of 2018, affecting the production costs negatively in the quarter. On the other hand, the salmon prices have been strong, and we have seen a sharp increase of the salmon price during a relatively short period. Havsbrún had good raw material sourcing again and had a strong performance.”

Bakkafrost expects to harvest 51,000 tonnes gutted weight in 2018, according to a press release from the company.

Bakkafrost aims at being self-supplied with 500 grams smolts in 2020. The benefits are a shorter production time at sea as well as reduced biological risk. The new hatchery under construction at Strond, Klaksvík is an important part of this plan. The hatchery is expected to start operation during 2018 and to be in full operation from 2020, writes Salmonbusiness.com.

Bakkafrost aims at giving the shareholders a competitive return on their investment, both through payments of dividends and by securing an increase in the value of the equity through positive operations. The long-term goal of the Board of Directors is that 30-50% of earnings per share shall be paid out as dividend. The financial position of Bakkafrost is strong with a solid balance sheet, a competitive operation and available credit facilities. The Annual General Meeting, convened on 13 April 2018, decided to pay out a dividend of DKK 10.50, corresponding to NOK 13.66 per share. The total dividend of DKK 513.0 million (NOK 667.0 million) was paid out on 30 April 2018.